The UAE’s Ministry of Finance announced that they will implement a Corporate Federal Tax (CIT) on business profits from June 1st, 2023. Right from the date of the announcement, Corporate Tax has drawn a lot of attention from all over the globe.
UAE is the 4th among the GCC countries to embrace Corporate Federal Tax. The primary objective of introducing Corporate Tax is to foster UAE’s credibility as a global business hub and accelerate the pace of transformation across the country.
Additionally, implementing the corporate tax in UAE helps to meet international standards for tax transparency while evading harmful tax practices. It can be tough for businesses to understand the effects of Corporate Tax on their operations and how to comply with them.
Applicable Rates of Corporate Income Tax in UAE
As per the UAE’s Ministry of Finance, the rates of Corporate Income Tax are as below:
- 0% CIT for taxable income up to AED 375,000.
- 9% CIT for taxable income over AED 375,000.
- A separate tax rate will apply to large companies that meet the specific criteria that is related to Pillar Two of the OECD Base Erosion & Profit-Sharing Project. (With global revenue in excess of 750 million or AED 315 billion)
Will Corporate Tax be Applicable to Free Zones?
- Corporate Tax will apply to businesses in UAE’s free zones. However, free zone businesses that comply with the regulatory requirements and do not conduct business in mainland UAE will continue to enjoy corporate tax incentives.
- Free zone businesses must register themselves and file corporate returns.
Will Corporate Income Tax Apply to Foreign Individuals & Entities?
- The corporate tax applies to those foreign individuals & entities that conduct business in the UAE regularly.
- A foreign investor’s income derived from dividends, capital gains, interest, royalties, and other investment returns will not be subject to Corporate Tax Services in UAE.
Our Impact Assessment of Corporate Tax Services in UAE
Our Gamut of Corporate Tax Services in UAE Includes:
1) Transfer Pricing
Compliance with the transfer pricing procedure has gained enormous significance among businesses since the introduction of Corporate Tax. Companies in the UAE must comply with the transfer pricing rules and documentation requirements.
FTA will rigorously scrutinize TP policies, procedures, inter-company and inter-group transactions, and any non-compliance leads to hefty penalties.
NR Doshi & Partners, with its 36 years of experience in the accounting and finance domain, enables you to meet all your TP requirements and smoothly carry out international business operations.
- A thorough analysis of cross-border financial transactions with respect to Corporate Tax.
- Checking BEPS readiness and contract analysis.
- Compliance with OECD Transfer Pricing Guidelines.
- Structuring transfer pricing policies.
- Proper transfer pricing documentation – Local, Master File, and Country by Country Report (CbCR).
- Assessing the applicability of the Master file, Local file, and CbCR.
- TP assessment of each jurisdiction in which your business operates.
- Establishing tax efficient Supply chain management.
- Ensuring the transactions (between enterprises under common ownership) satisfy the arm’s length principle.
- Exploring legal restructuring for optimal growth for Mainland and Freezone companies.
- Transfer pricing risks assessment.
2) Business Tax
Most jurisdictions want to fuel their revenue through taxes. Managing taxes can be challenging when businesses conduct business across multiple jurisdictions. NR Doshi and partners have a comprehensive and synchronized approach to complex tax problems. No matter where you conduct your business, our services are designed to meet the unique challenges of your jurisdiction while fulfilling your requirements.
Owing to our 36 years of vast industry experience, we have gained extensive knowledge of various financial aspects like taxation, accounting, business consulting, VAT advice, and much more. Our practical advice, coupled with a robust tax compliance framework, will help you overcome challenges like corporate taxes, transfer pricing, etc.
Along with giving you coverage across multiple jurisdictions, NR Doshi & Partners helps you assess the risks, identify lucrative opportunities, minimize costs, and confidently make prudent decisions.
Our services cover the following:
- Tax planning with respect to Corporate Tax rate
- Corporate tax impact assessment
- Multi-country planning
- Base Erosion and Profit Shifting (BEPS)
- FPI Advisory and Fund Compliance
- Individual, Family Office, Estate and Trust Compliance
- Technology and consulting support
- Corporate tax advisory
- Tax compliance support
- Litigation support
- Effective Tax Rate (ETR) management
3) Tax Management Consulting
Our services aim at minimizing tax burden, ensuring compliance with new laws, and smooth business operations can be demanding. NR Doshi & Partners, with over 35 years of consulting experience in various facets of financial services and deploying innovative technology, we can help you meet the UAE market’s new demands and manage multi-jurisdictional tax operations.
These challenges include compliance, reporting, and risk management for various kinds of taxes. Through a detailed analysis, we create a foolproof strategy, help customers transform their processes, technologies, and resourcing models, and offer global outsourcing capabilities.
With a coordinated tax strategy bolstered by an execution roadmap, we bring in our dedicated tax management specialists to address your critical strategies.
Our services include the following:
- Representing entities before tax bodies for assessment, appeals, search & seizure cases
- Advance tax calculations
- Complying with tax responsibilities arising out of Corporate Tax & ESR laws
- Filing returns related to VAT and other taxes
- Global taxation and transfer pricing
- Corporate Tax transition management
- Staff training and assessing business readiness
- Preparing your business for Corporate Tax Audits
- Define and implement TP policies, operating model, capital structure, tax function etc.
4) Business Process Solutions
Technology can play an integral role in creating a holistic approach to process improvement. Departments like HR, tax, finance, and accounting can benefit from technology while improving their day-to-day business operations.
NR Doshi & Partners performs a SWOT analysis of your organization. After conducting a detailed analysis, we will design and implement operational procedures, SaaS based technologies, and resource models. The main objective of this exercise is to help you increase your productivity and make informed decisions based on business insights.
NR Doshi & Partners can help with the following:
- ERP system redesign and implementation with respect to Corporate Tax.
- Business intelligence and data analytics.
- Automating accounting systems and financial reporting.
- Business insights and record management.
- Robotic process automation (RPA).
- Improving business efficiency through technology-enabled solutions.
Are you still in two minds or unsure about how to prepare for Corporate Tax? Connect with NR Doshi & Partners to schedule a consultation with our tax experts.
NR DOSHI’s 4-stage Action Plan for Corporate Tax Services in UAE
Looking for an authentic firm to deal with your corporate tax matters? Look no further than us
Why N R Doshi and Partners?
NR Doshi & Partners is a leading financial services provider in the UAE with 36 years of experience. If you are Looking for an authentic firm to help you with corporate tax, look no further than us. Please contact our corporate tax expert on +971 50 6591233 or firstname.lastname@example.org
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